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Oil Prices Spike as Saudi Arabia, Russia Extend 1.3 Million Barrel a Day Oil Cut Through December

A customer pumps gas at an Exxon gas station, Tuesday, May 10, 2022, in Miami. Marta Lavandier AP
A customer pumps gas at an Exxon gas station, Tuesday, May 10, 2022, in Miami. Marta Lavandier AP

Saudi Arabia and Russia agreed Tuesday to extend their voluntary oil production cuts through the end of this year, trimming 1.3 million barrels of crude out of the global market and boosting energy prices.

The dual announcements from Riyadh and Moscow pushed benchmark Brent crude above $90 a barrel in trading Tuesday afternoon, a price unseen in the market since November.

The countries’ moves could increase inflation and the cost for motorists at gasoline pumps. It also puts new pressure on Saudi Arabia’s relationship with the United States, as President Joe Biden last year warned the kingdom there would be unspecified “consequences” for partnering with Russia on cuts as Moscow wages war on Ukraine.

Saudi Arabia’s announcement, carried by the state-run Saudi Press Agency, said the country still would monitor the market and could take further action if necessary.

“This additional voluntary cut comes to reinforce the precautionary efforts made by OPEC+ countries with the aim of supporting the stability and balance of oil markets,” the Saudi Press Agency report said, citing an unnamed Energy Ministry official.

Related Story: 5 Ways the Biden Administration’s Threats to Saudi Arabia May Threaten American Interests

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